Which of the following journal entries properly records direct materials requisitions for the work-in-process inventory and direct materials variances

ACCOUNTING

Multiple Choice

Hudson Dock Company manufactures boat docks on an assembly line. Its standard costing system utilizes two cost categories, direct materials and conversion costs. Each product must pass through the Assembly Department and the Finishing Department. Direct materials are added at the beginning of the production process. Conversion costs are allocated evenly throughout production.

Data for the Assembly Department for May 20x3 are:

Work in process, beginning inventory: 70 units

Direct materials (100% complete)

Conversion costs (25% complete)



Units started during May 40 units



Work in process, ending inventory: 10 units

Direct materials (100% complete)

Conversion costs (50% complete)



Costs for May:

Standard costs for Assembly:

Direct materials $4,000 per unit

Conversion costs $16,000 per unit



Work in process, beginning inventory:

Direct materials $140,000

Conversion costs $260,000



Which of the following journal entries properly records direct materials requisitions for the work-in-process inventory and direct materials variances, assuming that the Assembly Department used 10% less materials than expected?

a. Work in Process – Assembly $160,000

Assembly Department Materials Cost Control $160,000

b. Work in Process – Assembly $160,000

Direct Materials Variance $ 16,000

Assembly Department Materials Cost Control $144,000

c. Work in Process – Assembly $144,000

Assembly Department Materials Cost Control $144,000

d. Work in Process – Assembly $144,000

Direct Materials Variances $ 16,000

Assembly Department Materials Cost Control $160,000

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